Financial Information for the Company and Its Subsidiaries

The 2020 Senior Unsecured Notes and 2022 Senior Unsecured Notes are senior unsecured obligations of the Company and are guaranteed by its existing and subsequently acquired or organized 100% owned domestic subsidiaries. The 2020 Senior Unsecured Notes and 2022 Senior Unsecured Notes are guaranteed on a full and unconditional and joint and several basis, with limited exceptions considered customary for such guarantees, including the release of the guarantee when a subsidiary's assets are sold. The following condensed consolidating financial statements present the Company (as parent issuer), the subsidiary guarantors, the subsidiary non-guarantors and consolidating adjustments. These condensed consolidating financial statements have been prepared and presented in accordance with Rule 3-10 of Regulation S-X “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.” The operating and investing activities of the separate legal entities are fully interdependent and integrated. Accordingly, the results of the separate legal entities are not representative of what the operating results would be on a stand-alone basis.



Condensed Consolidating Balance Sheet - September 30, 2016 (In thousands)
	Parent Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Assets
Current assets:
Cash and cash equivalents	$	3,858	$	7,287	$	94,913	$	—		$	106,058
Restricted cash and marketable securities	—		—		12,794		—			12,794
Accounts receivable, net	—		277,535		148,145		(785		)	424,895
Supplies inventory	—		—		22,505		—			22,505
Prepaid and other current assets	33,733		27,826		15,919		(13,024		)	64,454
Total current assets	37,591		312,648		294,276		(13,809		)	630,706
Property and equipment, net	11,740		36,855		178,618		—			227,213
Investments in and receivables from unconsolidated affiliates	5,282,324		1,754,313		—		(6,925,631		)	111,006
Goodwill	—		2,225,411		—		2,074,691			4,300,102
Intangible assets, net	12,967		1,664,170		1,790		—			1,678,927
Other assets	6,828		22,558		21,597		(1,998		)	48,985
Total assets	$	5,351,450	$	6,015,955	$	496,281	$	(4,866,747	)	$	6,996,939
Liabilities and Equity
Current liabilities:
Current portion of long-term debt	$	8,700	$	20	$	13,300	$	—		$	22,020
Accounts payable	1,751		1,877		27,252		(3,689		)	27,191
Accrued salaries and benefits	33,789		156,180		23,329		—			213,298
Accrued interest	18,565		—		12		—			18,577
Other accrued liabilities	12,563		43,242		55,940		(10,120		)	101,625
Total current liabilities	75,368		201,319		119,833		(13,809		)	382,711
Long-term debt	2,550,961		30		69,922		(29,018		)	2,591,895
Deferred income taxes	297,788		464,714		—		(1,998		)	760,504
Other long-term liabilities	7,613		98,324		23,960		—			129,897
Intercompany payable	—		1,228,157		—		(1,228,157		)	—
Noncontrolling interests – redeemable	—		—		60,908		116,969			177,877
Equity:
Total AmSurg Corp. equity	2,419,720		4,023,411		128,483		(4,151,894		)	2,419,720
Noncontrolling interests – non-redeemable	—		—		93,175		441,160			534,335
Total equity	2,419,720		4,023,411		221,658		(3,710,734		)	2,954,055
Total liabilities and equity	$	5,351,450	$	6,015,955	$	496,281	$	(4,866,747	)	$	6,996,939



Condensed Consolidating Balance Sheet - December 31, 2015 (In thousands)
	Parent Issuer		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Assets
Current assets:
Cash and cash equivalents	$	20,437	$	27,507	$	58,716	$	—		$	106,660
Restricted cash and marketable securities	—		—		13,506		—			13,506
Accounts receivable, net	—		223,434		113,896		—			337,330
Supplies inventory	—		—		21,406		—			21,406
Prepaid and other current assets	28,739		39,046		16,062		(8,076		)	75,771
Total current assets	49,176		289,987		223,586		(8,076		)	554,673
Property and equipment, net	12,515		14,601		162,052		—			189,168
Investments in and receivables from unconsolidated affiliates	4,901,026		1,775,272		—		(6,507,128		)	169,170
Goodwill	—		1,956,741		—		2,013,469			3,970,210
Intangible assets, net	12,780		1,579,537		2,320		—			1,594,637
Other assets	4,653		1,717		17,078		(1,998		)	21,450
Total assets	$	4,980,150	$	5,617,855	$	405,036	$	(4,503,733	)	$	6,499,308
Liabilities and Equity
Current liabilities:
Current portion of long-term debt	$	8,700	$	—	$	11,677	$	—		$	20,377
Accounts payable	2,816		3,760		29,837		(3,852		)	32,561
Accrued salaries and benefits	31,510		158,705		12,322		—			202,537
Accrued interest	30,463		—		17		—			30,480
Other accrued liabilities	13,962		76,590		32,909		(4,224		)	119,237
Total current liabilities	87,451		239,055		86,762		(8,076		)	405,192
Long-term debt	2,326,103		—		55,249		(23,396		)	2,357,956
Deferred income taxes	268,573		432,923		—		(1,998		)	699,498
Other long-term liabilities	4,560		71,509		20,114		—			96,183
Intercompany payable	—		1,228,157		—		(1,228,157		)	—
Noncontrolling interests – redeemable	—		—		63,060		112,672			175,732
Equity:
Total AmSurg Corp. equity	2,293,463		3,646,211		132,267		(3,778,478		)	2,293,463
Noncontrolling interests – non-redeemable	—		—		47,584		423,700			471,284
Total equity	2,293,463		3,646,211		179,851		(3,354,778		)	2,764,747
Total liabilities and equity	$	4,980,150	$	5,617,855	$	405,036	$	(4,503,733	)	$	6,499,308



Condensed Consolidating Statement of Operations - For the Three Months Ended September 30, 2016 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Net revenue	$	8,671		$	471,190		$	358,955	$	(16,600	)	$	822,216
Operating expenses:
Salaries and benefits	20,106			333,420			108,659		(904		)	461,281
Supply cost	—			1,119			46,852		(19		)	47,952
Other operating expenses	6,367			48,186			76,052		(15,677		)	114,928
Transaction costs	8,036			8,870			—		—			16,906
Depreciation and amortization	1,134			22,444			8,007		—			31,585
Total operating expenses	35,643			414,039			239,570		(16,600		)	672,652
Net gain on disposals and deconsolidations	—			3,598			546		—			4,144
Equity in earnings of unconsolidated affiliates	79,314			67,427			—		(142,296		)	4,445
Operating income	52,342			128,176			119,931		(142,296		)	158,153
Interest expense (income), net	(6,948		)	39,069			794		—			32,915
Earnings before income taxes	59,290			89,107			119,137		(142,296		)	125,238
Income tax expense	19,336			9,802			520		—			29,658
Net earnings	39,954			79,305			118,617		(142,296		)	95,580
Less net earnings (loss) attributable to noncontrolling interests	—			(8		)	55,634		—			55,626
Net earnings attributable to AmSurg Corp. shareholders	39,954			79,313			62,983		(142,296		)	39,954
Preferred stock dividends	(2,264		)	—			—		—			(2,264		)
Net earnings attributable to AmSurg Corp. common shareholders	$	37,690		$	79,313		$	62,983	$	(142,296	)	$	37,690



Condensed Consolidating Statement of Operations - For the Nine Months Ended September 30, 2016 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Net revenue	$	24,915		$	1,324,062		$	993,614	$	(37,198	)	$	2,305,393
Operating expenses:
Salaries and benefits	66,447			948,173			261,683		(1,172		)	1,275,131
Supply cost	—			3,271			141,399		(52		)	144,618
Other operating expenses	20,019			135,738			213,972		(35,974		)	333,755
Transaction costs	10,312			13,119			—		—			23,431
Depreciation and amortization	3,309			63,972			23,430		—			90,711
Total operating expenses	100,087			1,164,273			640,484		(37,198		)	1,867,646
Net gain on disposals and deconsolidations	—			6,455			284		—			6,739
Equity in earnings of unconsolidated affiliates	236,056			201,802			—		(419,483		)	18,375
Operating income	160,884			368,046			353,414		(419,483		)	462,861
Interest expense (income), net	(13,982		)	107,573			2,047		—			95,638
Earnings before income taxes	174,866			260,473			351,367		(419,483		)	367,223
Income tax expense	57,980			24,434			1,406		—			83,820
Net earnings	116,886			236,039			349,961		(419,483		)	283,403
Less net earnings (loss) attributable to noncontrolling interests	—			(15		)	166,532		—			166,517
Net earnings attributable to AmSurg Corp. shareholders	116,886			236,054			183,429		(419,483		)	116,886
Preferred stock dividends	(6,792		)	—			—		—			(6,792		)
Net earnings attributable to AmSurg Corp. common shareholders	$	110,094		$	236,054		$	183,429	$	(419,483	)	$	110,094



Condensed Consolidating Statement of Operations - For the Three Months Ended September 30, 2015 (In thousands)
	Parent Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Adjustments			Total Consolidated
Net revenue	$	5,975		$	339,484	$	314,382	$	(9,614	)	$	650,227
Operating expenses:
Salaries and benefits	17,642			231,769		78,249		(128		)	327,532
Supply cost	—			476		45,182		(20		)	45,638
Other operating expenses	7,054			34,742		66,522		(9,466		)	98,852
Transaction costs	270			1,837		—		—			2,107
Depreciation and amortization	1,017			14,906		8,183		—			24,106
Total operating expenses	25,983			283,730		198,136		(9,614		)	498,235
Net gain on disposals and deconsolidations	—			9,112		—		—			9,112
Equity in earnings of unconsolidated affiliates	96,232			64,423		—		(155,720		)	4,935
Operating income	76,224			129,289		116,246		(155,720		)	166,039
Interest expense, net	11,766			17,845		631		—			30,242
Earnings before income taxes	64,458			111,444		115,615		(155,720		)	135,797
Income tax expense	21,797			15,210		511		—			37,518
Net earnings	42,661			96,234		115,104		(155,720		)	98,279
Less net earnings attributable to noncontrolling interests	—			—		55,618		—			55,618
Net earnings attributable to AmSurg Corp. shareholders	42,661			96,234		59,486		(155,720		)	42,661
Preferred stock dividends	(2,264		)	—		—		—			(2,264		)
Net earnings attributable to AmSurg Corp. common shareholders	$	40,397		$	96,234	$	59,486	$	(155,720	)	$	40,397



Condensed Consolidating Statement of Operations - For the Nine Months Ended September 30, 2015 (In thousands)
	Parent Issuer			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Net revenue	$	20,145		$	954,642	$	915,791		$	(27,956	)	$	1,862,622
Operating expenses:
Salaries and benefits	50,796			671,988		227,703			(380		)	950,107
Supply cost	—			1,361		132,705			(54		)	134,012
Other operating expenses	19,471			106,452		196,023			(27,522		)	294,424
Transaction costs	862			4,698		—			—			5,560
Depreciation and amortization	2,907			43,830		23,799			—			70,536
Total operating expenses	74,036			828,329		580,230			(27,956		)	1,454,639
Net gain (loss) on disposals and deconsolidations	—			5,889		(35		)	—			5,854
Equity in earnings of unconsolidated affiliates	233,362			183,519		—			(405,306		)	11,575
Operating income	179,471			315,721		335,526			(405,306		)	425,412
Interest expense, net	35,630			53,223		1,818			—			90,671
Earnings before income taxes	143,841			262,498		333,708			(405,306		)	334,741
Income tax expense	46,467			29,134		1,359			—			76,960
Net earnings	97,374			233,364		332,349			(405,306		)	257,781
Less net earnings attributable to noncontrolling interests	—			—		160,407			—			160,407
Net earnings attributable to AmSurg Corp. shareholders	97,374			233,364		171,942			(405,306		)	97,374
Preferred stock dividends	(6,792		)	—		—			—			(6,792		)
Net earnings attributable to AmSurg Corp. common shareholders	$	90,582		$	233,364	$	171,942		$	(405,306	)	$	90,582



Condensed Consolidating Statement of Cash Flows - For the Nine Months Ended September 30, 2016 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Cash flows from operating activities:
Net cash flows provided by operating activities	$	79,353		$	226,593		$	389,490		$	(344,346	)	$	351,090
Cash flows from investing activities:
Acquisitions and related expenses	(296,689		)	(356,205		)	—			301,158			(351,736		)
Acquisition of property and equipment	(3,019		)	(35,450		)	(25,538		)	—			(64,007		)
Increase in cash due to consolidation of previously unconsolidated affiliates	—			—			31,412			—			31,412
Purchases of marketable securities	—			—			(498		)	—			(498		)
Maturities of marketable securities	—			—			2,987			—			2,987
Other, net	—			(2,217		)	(4,271		)	—			(6,488		)
Net cash flows provided by (used in) investing activities	(299,708		)	(393,872		)	4,092			301,158			(388,330		)
Cash flows from financing activities:
Proceeds from long-term borrowings	423,000			—			7,006			—			430,006
Repayment on long-term borrowings	(204,525		)	(14		)	(9,729		)	—			(214,268		)
Distributions to owners, including noncontrolling interests	—			(153,119		)	(363,302		)	344,346			(172,075		)
Capital contributions	—			296,689			—			(296,689		)	—
Changes in intercompany balances with affiliates, net	(5,621		)	—			5,621			—			—
Other, net	(9,078		)	3,503			3,019			(4,469		)	(7,025		)
Net cash flows provided by (used in) financing activities	203,776			147,059			(357,385		)	43,188			36,638
Net increase (decrease) in cash and cash equivalents	(16,579		)	(20,220		)	36,197			—			(602		)
Cash and cash equivalents, beginning of period	20,437			27,507			58,716			—			106,660
Cash and cash equivalents, end of period	$	3,858		$	7,287		$	94,913		$	—		$	106,058



Condensed Consolidating Statement of Cash Flows - For the Nine Months Ended September 30, 2015 (In thousands)
	Parent Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Adjustments			Total Consolidated
Cash flows from operating activities:
Net cash flows provided by (used in) operating activities	$	(20,702	)	$	313,286		$	368,391		$	(233,773	)	$	427,202
Cash flows from investing activities:
Acquisitions and related expenses	(29,157		)	(236,107		)	—			31,774			(233,490		)
Acquisition of property and equipment	(5,659		)	(15,418		)	(25,929		)	—			(47,006		)
Purchases of marketable securities	—			—			(1,743		)	—			(1,743		)
Maturities of marketable securities	—			—			4,233			—			4,233
Other, net	—			(779		)	(3,195		)	—			(3,974		)
Net cash flows used in investing activities	(34,816		)	(252,304		)	(26,634		)	31,774			(281,980		)
Cash flows from financing activities:
Proceeds from long-term borrowings	—			—			10,197			—			10,197
Repayment on long-term borrowings	(6,525		)	—			(9,212		)	—			(15,737		)
Distributions to owners, including noncontrolling interests	—			(59,616		)	(332,301		)	233,773			(158,144		)
Capital contributions	—			29,157			—			(29,157		)	—
Changes in intercompany balances with affiliates, net	524			—			(524		)	—			—
Other, net	(4,102		)	2,653			1,871			(2,617		)	(2,195		)
Net cash flows used in financing activities	(10,103		)	(27,806		)	(329,969		)	201,999			(165,879		)
Net increase (decrease) in cash and cash equivalents	(65,621		)	33,176			11,788			—			(20,657		)
Cash and cash equivalents, beginning of period	134,351			23,471			50,257			—			208,079
Cash and cash equivalents, end of period	$	68,730		$	56,647		$	62,045		$	—		$	187,422